WPenner's Blog

I spent a lot of time in 2022 writing about space, and especially the Canadian space industry. I dug deep and found out a lot about it. You can read about my motivations in this post about why I started writing about Canadian Space.

I started with the assumption that it was similar to the US industry, just smaller. That couldn't be further from the truth. I also believed that it's best days were ahead of it, especially with the shift to commercial space. Again, I was entirely wrong.

It's much smaller than I had imagined and far more insular. There is also a tendency in the space industry to remain highly insular while mouthing platitudes about inclusion.

There are some conferences in the space/EO industry in which every year they have very similar panels with almost the same speakers, who basically say the same things ... to the same audience.

I have stopped going to many of them, but I cannot help but wonder why, just why?!

— Aravind 🌍 🛰 (@aravindEO) October 2, 2023

There are a few entrepreneurial types doing interesting things, but receiving little support. I would go so far as to say amazingly few will make any impact on the world, despite bold press releases to the contrary.

Not only is the current ecosystem too small to ever become sustainable, but the value to the Canadian market is not large enough to sustain it without governmental funding. And the funding is tiny. Actually, "minuscule" might be a better word.

Consider, NASA's budget which in 2022-23 was \$22.5B USD, while the budget of the Canadian Space Agency (CSA) was $ 400M CAD ($ 298M USD). This amounts to 1.3% of NASA's budget.

Consider further, the case of SpaceX, the poster child for commercialization in the US. It wouldn't exist without funding help from NASA. SpaceX received an initial \$100M, which, considering the exchange rate, would more than ⅓ of CSA's budget. CSA's awards usually top out at $250,000 CAD.

Since it's inception SpaceX has received $10B in additional funding and contracts. If the CSA spent its entire budget, it would take more than 33 years to fund a Canadian SpaceX.

Canada's space success does not hinge on a government with vision and money backing their horse. The time and resources required to truly succeed in becoming a space faring nation are too large for a country that spends more in paying its national debt's interest than in spends on defence.

And that is before considering macro-economic factors. One such factor is the anti-entrepreneurial environment Canada has created over the last decade. Another is the demographic bomb currently exploding over our collective heads which is drying up capital investments and tax revenue, shrinking the work force by an order of magnitude, while increasing the number of people drawing on social support.

Having a very limited budget but a highly educated workforce, the CSA has pursued a very clever strategy of partnering with other space agencies. They developed special relationships with both the Americans and Europeans which provides Canadians with unprecedented access. The level of creativity and negotiating ability CSA employees bring to the table is truly inspiring and I wish them all the success they can wring from the stone.

Of course, the international reputation damage the current government continually inflicts on the country harms Canadians trying to do business abroad. Thus, the prospects for CSA collaborations looks bleak. And for these reasons, I chose to stop writing about the Canadian space sector. ¹